I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
3,444 Blog Posts

The importance of bias and a look at bitcoin futures

Coming into the week with a bullish bias played a big part in Monday trade.  Monday started out with a small gap down.  7 NASDAQS available.  Inside Friday range.  Inside upper quadrant from Friday’s double distribution trend up.  The  overnight high was another 13 points up.  Looking for 20, risking 10.  Drop dead stop at the overnight low.

This was primary hypothesis on the morning report.

Risking 1 to make 2.  All day.  Hell I’d risk 1 to make 1.25 with a directional bias and layer-upon-layer of auction theory support.  I will wait weeks for these conditions.  Fasting and waiting.  Polishing the robots and reading old books.

Then all at once. Plugging gaps and sending runners for the highs.  Or the lows.  No allegiance to the bulls.  Only the robots.  I am their executor.

Anyhow, bitcoin futures are different natural market.

I have no statistics.  I lack the reams of raw CME data needed to parse and model upon.  I have no internals like TICK or NET ISSUES.

All we have is auction theory.  So here it goes:

  • 2-3 day trend: 3
  • 2-3 week trend: 2
  • strongest volume: 2
  • nearby magnets: 3
  • Excess hi/low: 3.5
  • Score: 3 neutral

No short term directional bias.

What has happened so far?

Bitcoin futures were higher during the holiday shortened first week of 2018.  After consolidating for most of the week, bitcoin came into Friday with a gap up and trend higher.  The market continued to test higher into the weekend.

Monday it opened gap down, down below the prior consolidation area, potentially trapping supply above.  The day began with a drive lower which revealed a strong responsive bid which resulted in a sharp excess low being formed.  Price has traded in the first hour’s range since.

What is likely to happen next?

Primary hypothesis is for sellers to defend an attempt back into the prior consolidation area ~14,895 setting up a move lower.


And with all that in mind, I do not carry enough conviction to participate in the short term auctions for bitcoin.  More information is needed.  I will, however, continue to wait before adding to my long-term BTC reserve.  I want to see how this overplay for the underlay resolves which is, as always, TBD.

Bias elevated my game.  It would behoove you to develop a habit of forming your own bias.  Maybe you pluck a few arrows from my quiver.  Hopefully you craft some of your own.  Then you will better understand the nuance of it all.  The in-between.  The raw materials.  Pure, unadulterated data.


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One comment

  1. duuude


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